Thinking | 6 July 2022

Employment Extra – Issue One

By Fay Calderone and Alexandra Armstrong-Millar

Employment Extra provides a rundown of recent issues, legislative updates and decisions impacting your workplace. In our first edition, we outline what you need to know about increases to the minimum wage and superannuation contribution rate. We also examine three recent cases that serve as important reminders for employers.

On 1 July 2022, the compulsory superannuation contribution rate was raised from 10% to 10.5%. This rate is set to continue until 1 July 2025, when it is due to increase to 12%.

Payment of this extra superannuation will be determined by an employees’ employment contract, which may either state superannuation is to be paid on top of an employee’s base salary or included as part of their total remuneration package.

Employers should be cognisant of these changes and review existing employment contracts to ensure employees are receiving the appropriate rate each financial year.

On 1 July 2022, the high-income threshold for unfair dismissal applications increased from $158,500 to $162,000, and the maximum compensation cap was raised from $79,250 to $81,000.

Where an employee earns more in a year than the high-income threshold amount, and are not covered by a modern award, they are not eligible to make an unfair dismissal claim.

The Fair Work Commission’s Expert Panel for annual wage reviews approved a 5.2% increase to the National Minimum Wage and an increase of at least 4.6% for workers covered by modern award minimum wage rates.

From 1 July 2022, the National Minimum Wage increased to $812.60 a week/$21.38 an hour.

Workers within the aviation, tourism and hospitality sectors will have to wait until 1 October 2022 for their increases due to prolonged economic effects of the pandemic.

Employers who pay their employees under an industrial instrument, such as an enterprise agreement, should review the rates under that instrument to make sure they are equal to or above the minimum wage rates.

For more information, please see our full article

From 1 July 2022, the Occupational Health and Safety Amendment (Psychological Health) Regulations (Regulations) are expected to come into effect and will include new obligations for employers to address workplace ‘psychological hazards’.

‘Psychosocial Hazard’ include factors in the work design, systems, management, carrying out of the work or personal or work related interactions within the working environment that can create a risk to health and safety. Bullying, sexual harassment, aggression or violence, exposure to traumatic events, high and low job demands, poor support, environmental conditions and workplace relationships are examples.

What does this mean for employers?

Employers should follow these steps to ensure they are compliant with the Regulations:

  1. Identify psychosocial hazards in consultation with employees.
  2. Eliminate risk associated with a psychosocial hazard or reduce the risk if it’s not reasonably practicable to eliminate it.
  3. Review, and, where necessary, revise measures implemented to control risks associated with psychosocial hazards.
  4. Implement a prevention plan where there are more than 50 employees in your organisation and where one of the following hazards has been identified:
    • aggression or violence;
    • bullying;
    • exposure to traumatic content or events;
    • high job demands; or
    • sexual harassment.
  5. If there are more than 50 employees in your organisation, report on any psychosocial complaint involving aggression, violence, bullying or sexual harassment to WorkSafe Victoria every six months.

The Federal Court of Australia (FCA) recently provided clarity on what is considered ‘unreasonable’ hours worked in addition to the 38 maximum weekly hours.

The FCA found that a meat wholesaler who required an employee to work 50 hours per week on a ‘blended rate’ that included overtime was in breach of s 62 of the Fair Work Act 2009 (Cth) (FW Act).

The FCA held Dick Stone gave the employee ‘no choice’ as he had ‘no knowledge of Australian law or rights’. While Dick Stone submitted the employee freely entered his employment contract, the FCA found parties cannot contract out of the minimum standards under the FW Act and there were obvious risks associated with lengthy shifts in a job that required the use of knives.

The time and the number of additional hours worked, including the regularity and frequency of them and loss of weekends, are relevant considerations in determining reasonableness. The decision prompts employers to review working hours of staff, factoring the nature and needs of the workplace, as well as ensuring any set-off clauses in employment contracts the organisation wishes to rely upon are properly drafted. Employers may be exposed to general protections claims if an employee is subjected to adverse action for refusing to work unreasonable additional hours.

Australasian Meat Industry Employees Union v Dick Stone Pty Ltd [2022] FCA 512

A High Court case involving a Construction Forestry Maritime Mining Energy Union (CFMMEU) officer and the Australian Building and Construction Commissioner (ABCC) found Courts have wide discretion when determining civil penalties under the FWA and maximum penalties are not only reserved for the most serious breaches.

The CFMMEU officer falsely stated that non-union employees needed to join the CFMMEU before they could perform work at the site in breach of s 349, attracting civil penalties under s 546 of the FWA. The CFMMEU has a long history of prior breaches of the same section of the FWA.

Considering an appropriate penalty does not invite the court to consider whether the penalty would be proportionate to the severity of the breach. The focus of civil penalties is to promote compliance through deterring wrongdoers and the public from committing the same breach again. Regardless of the severity of a contravention, the High Court found it is possible to impose maximum penalties as long as the penalty does not go beyond what is necessary to achieve deterrence.

It is expected the decision will impact civil penalties under other regimes. Regulators like the ABCC will be emboldened to seek higher penalties, particularly against repeat contraveners.

Australian Building and Construction Commissioner v Pattinson [2022] HCA 13

The Full Court of the Federal Court of Australia recently confirmed a casual employee cannot be dismissed at will and is protected by the general protections in the FWA. Sections 340(1)(a)(ii) and 341 of the FWA provide a person must not take adverse action (including dismissing) another person from employment because they have exercised a workplace right by making a complaint or inquiry about their employment.

The decision involved a casual truck driver for a dairy farming and delivery company who was asked to work over the Christmas holidays and inquired about payment of overtime for the additional work. The truck driver was later dismissed from his employment and brought a general protections claim against his employer.

At first instance, the judge found that dismissing a casual employee was not adverse action because the employee was casual and therefore the employment could simply cease.

On appeal, the Court clarified general protections apply to permanent and casual employees. The employer was unable to prove the inquiry made by the truck driver did not form a reason for the decision to terminate his employment and the case has been referred back to the Federal Circuit and Family Court for a further hearing.

The decision is an important reminder for employers to ensure they only terminate employment for a lawful reason, no matter what the nature of the employment is.

Jess v Cooloola Milk Pty Ltd [2022] FCAFC 75

This edition of Employment Extra was written with contributions from Lawyer Rachel Shaw and Law Graduates Esther Chen, Rachel Bonic, Laura D’Aprano and Nate Cheng.

Contact

You might be also interested in...

Employment & Workplace Relations | 1 Jul 2022

‘Enough is Enough’ – WA Parliamentary Inquiry report calls for extensive action to address sexual harassment in WA FIFO industry

There will be a push for fundamental changes following the handing down of a WA Parliamentary Inquiry report into sexual harassment against women in the fly-in fly-out (FIFO) mining industry.

Employment & Workplace Relations | 15 Jun 2022

Minimum wage increase 2022: wages rise by 5.2% for the lowest-paid

The National Minimum Wage is set to increase by 5.2%, as published by The Fair Work Commission. We comment on what the changes will mean for employers.